“A 5% discount every day on every transaction is unique in the retail world and has the power to drive profitable sales to Target,” said Terry Scully, president of Target Financial Services.

In addition to leading to meaningful sales gains, some Wall Street analysts think Target’s credit-card rewards program will be a powerful low-price hook that competitors would have trouble matching.

For consumers, the flat 5% discount is attractive because the rewards are ample, immediate, and easy to understand. As with any program that rewards customer loyalty, however, you must be sure that you’re taking advantage of it, and not the other way around:

Peter Davis, president of Vesdia Corp., which creates rewards programs for merchants and banks, said Target’s new program “is a rich offer.” However, he warned that consumer savings will be eroded if shoppers carry a balance on their cards, which have a 25.4% interest rate.

Target, I’ve been reminded time and again, is one of the easiest stores in the world to walk out of with stuff you never intended to buy. This seems to be especially the case when we enter a Target with the kids.